Overcoming the Challenges to the Sustainability of Tourism in Caribbean SIDS.

1. Overcoming the Challenges to the Sustainability of Tourism in Caribbean SIDS. Cletus Springer Principal Consultant Impact Consultancy Services Inc.

2. Abstract • Paper aims at identifying factors that contribute to and detract from STD • Contends that tourism is only industry in which region has competitive advantage • Identifies significant threats to sustainability • Need for simultaneous action at all levels to strengthen resilience of the industry and the wider economies of SIDS.

3. Structure of Paper • CH1: Theoretical Constructs • CH2: Economic O/view of Caribbean • CH3: Nature of Global Terrorism • CH4: Nature of Caribbean Tourism • Ch5: Economic Impact of Tourism • CH6: Social and Environmental Impacts • CH7: Investment Mobilization • CH8: Air Access & Distribution • CH9: International Trade Agenda &Tourism • Ch10: Conclusions • CH11: Strategic Priorities

4. CH1: Theoretical Constructs • Vulnerability: proneness to damage from external forces. • Economic: risks faced by economies from exogenous shocks to systems of production, distribution and consumption; • Social: degree to which societies or socio-economic groups are affected by stresses and hazards (internal/external) that negatively impact social cohesion; • Environmental: risk of damage to natural eco-systems.

5. Theoretical Constructs (2) • Sustainable Tourism Development - an approach that: • Develops tourism to the fullest extent possible; • Promotes rational use of local, natural, cultural and man-made resources; • Diversifies the tourism product; • Is responsive to changes in market demand; • Uses a planning/implementation process that is integrated, equitable, participatory, and consensual.

6. Economic O/view of Caribbean • Since 80s, built around, agriculture, manufacturing and tourism; • Since mid-1990s new focus on services • Robust growth in first half of 1980s (avr.7.4%) to avr. 2% in second half of 1990s; • Contraction in 2000s due to 9/11 fall out and Iraq war; fiscal restraint; structural adjustment; lower aid flows etc. • Downturn underscores vulnerability of region.

7. CH3: Nature of Global Tourism • Most competitive industry in world • Complex/composite with many parts and many actors • World’s largest industry – by end of ‘03 will generate 67.4 m jobs (2.6% of global employment); US$1280.4b of GDP. • TT Economy – by end of 2003 will generate 194.5m jobs (7.6% of global); US$3,526b of GDP; • Forecast demand – 3% real growth in ’03; 5.5% per year between ’03 and 2013.

8. Major trends in Global Tourism • Industry evolving and growing • Sustained growth in “quality” tourism; • Move from “mass” to more diverse and specialized industry based on natural and cultural environment – “alternative” “eco-”; “green”; “nature”; and “heritage” • Influence of changes in preferences, demographics, values, lifestyles; • Emphasis on value for money; • More information-intensive

9. Major trends cont’d • Impact of 9/11 • Fear of travel; preference for close destinations; premium on safety; more, shorter trips; • Strong growth in family values • Still strong interest in Caribbean • Good long-term future for Caribbean but shortfall in revenue in short to medium term

10. CH4: Nature of Caribbean Tourism • Equitable climate, hospitable people, outstanding scenic beauty, sandy beaches, proximity to major travel markets, political and social stability; • Variation in maturity of destinations • DR, B’dos, JA and Bah at high end; • SLU, A&B, T&T and Bel at middle; • SHN, D’ca, and SVG at lower middle; • Strong similarities but Variations in product

11. Nature of C’bbean Tourism (2) • Accommodation sub-sector • Hotels, apartment hotels, guest houses, self catering apartments, luxury villas • Growth in accommodation behind growth in stay-over visitors • High number of All Inclusives (AI) – debate on AIs - The Sandals Effect • Cruise tourism • Stronger growth than land-based • Strong competition among ports • Debate over economic rents of CT. • Yachting Sector • Substantial growth • Significant for G’da, SVG and SLU

12. Ch5: Economic Impact of Tourism • Contribution to GDP – 22% in D’CA to 51% in B’DOS to 69% in SLU in 1999 • Employment generation – 19% in D’CA to 51% in SLU to 56 in BAH in 1999 • Also FOREX and national income • Weak linkage/strong leakage – on input supplies, wages, profit and revenue • Measuring the economic impact • Limitations, outcomes of attempts at EIA

13. CH6: Social Impacts • Positive – • job creation; improved standard of living; opportunities for linkage; increase in critical mass for viability; subsidization of infrastructure costs in remote areas; stronger appreciation of local culture and heritage; • Negative • Weak/slow distribution of benefits; tensions among local populace; over-consumption of resources; potential to engender crime, prostitution and spread of communicable diseases

14. Best Practice in Mitigating Social Impacts of Tourism • Bahamahost Programme • Saint Lucia Heritage Tourism Programme (SLHTP) • Global Code of Ethics

15. Environmental Impacts of Tourism • Impacts on coastal and marine environment – coastal erosion; destruction of coastal and marine assets hence induced vulnerability to natural disasters • Land based impacts – high energy/water demand/use; untreated effluent; noise pollution; • Advances in Tourism Planning and Administration • Jamaica Tourism Master Plan; CAST, St. James Club, Green Globe Standard.

16. Investment Mobilization and Facilitation • Growth in arrivals faster than growth in accommodation – 40,000 rooms needed by 2010 • Challenging investment situation • Increase in equity requirements • High rate of mergers and acquisitions • Best Practices in Hotel Investment • Credit Enhancement; project financing, tax abatements

17. Investment Mobilization (2) • Business Operating Conditions • High transaction costs and taxes • Inadequate/inappropriate physical planning • Lack of integrated planning • Performance of Small Hotels • Constraints of SMEs • Absence of economies-of-scale; • Lack of professional/marketing skills • Limited access to capital, HR, marketing expertise and technology

18. CH8: Air Access and Distribution • Strong growth rates in airline industry except for 1991 • Threats to sustainability • Tour operators • Hub & spoke system • Cruise line factor • State of regional airline industry • Impacts of 9/11 and Iraq War • Air safety issues

19. CH9: The International Trade Agenda and Caribbean Tourism • Aims of the GATS • Impacts of the GATS • Elements of a regional strategy on GATS • Increasing value-added from tourism • Enhancing capacity of small services suppliers • Removal of restrictions placed by third countries • Increasing direct market access of service suppliers to main tourist originating markets • Promoting the sustainable development of the tourism industry.

20. Conclusions • Caribbean Tourism is highly vulnerable economically, socially and environmentally; • Clear recognition of some of things that can be done to build the resilience of industry; • Financial, HR and technical constraints to be overcome; • Innovative investment mechanisms needed; • Backward/forward linkages to be strengthened • capability for sustained tourism research to be strengthened; especially in EIA • Cooperative approach to strengthening air access and distribution needed.

21. CH: Strategic Response • WTTC Strategic Priorities • CTO Strategic Plan (2002-2012) • National Priorities • Establish tourism as lead sector • Stimulate and facilitate investment in environmentally-sound tourism projects • Project a positive identity in international markets • Strengthen linkages • Increase and sustain local participation in planning. development and ownership of tourism • Improve quality and attractiveness of experience • Improve public’s perceptions and attitudes • Participate and take advantage of regional initiatives .

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